Non-compliant rental

Neil asks:
(updated on Tuesday, February 07th 2017)

A recent Tenancy Tribunal decision awarded a full refund of all rent paid to a tenant where it was proven that the rented premises was non-compliant. Please can you point us to this case to read and review?

We began renting a house built in 1998 over 12 months ago on a two year fixed term which we have just discovered does not have a Code of Compliance Certificate. We also note the landlord has limited or no home building insurance and this concerns us. Can you please advise?

Can we have the contract terminated by the Tenancy Tribunal and claim back the rent? Is the landlord committing an unlawful act renting out the home?

Our Experts Answer:

Recent decisions of the Tenancy Tribunal that relate to landlords returning rent paid where the premises could not lawfully be used for residential purposes can be searched online at Note - there have been other cases where premises were found to be unlawful for residential purposes where the Tribunal did not order rent repayment.

A residential rental property covered by the Residential Tenancies Act must comply with all building, health and safety requirements that apply to the premises, and there should be no legal impediment to the occupation of the premises for residential purposes. Speak with your local council if you have any concerns about the property and whether its use for residential purposes is lawful. It would be helpful to get documentation from the local council to support any concerns before you raise them with the landlord, who may be able to fix the problem.

The Tenancy Tribunal may order a return of rent (or a portion of it) where it is determined the use of the premises for a residential purposes is not lawful. The Tribunal may also order the landlord to pay exemplary damages of up to $4,000 to a tenant where the premises does not comply with all building, health and safety requirements, and up to $1,000 where the arrangement is a prohibited transaction. A decision on termination of the tenancy may also be included if this has been applied for in the application to the Tenancy Tribunal.

Alternatively, a landlord may agree to end a fixed term tenancy early if you raise these concerns with them. There is no legal requirement under the Act for landlords to have insurance.

For more on the rights and responsibilities of landlords and tenants, go to www.tenancy.govt.nz

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